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Online Merchant Scams | Three Keys in spotting a scam | Protecting your company

Updated on October 20, 2012
Is he a scam artist?
Is he a scam artist?

As if online merchants didn't already have enough to worry about the foreign scammers are hard at work trying to figure out new ways to pull off a scam.

We sell internationally so we might see more than someone just selling regionally in the states. The growing tactics and tricks are very concerning.

A couple years ago it was through e-mail. About every other week we would receive an e-mail always in broken English that went something like this “ Hi my name is John, I inquire about your ______________ please send me price I urgently wait your response.” Or “URGENT PLEASE, I must need a ____________ please give price how quickly you ship to me. URGENT PLEASE”.

Last year it was a bit harder to tell as the e-mail would come from what looked to be a legitimate source. The e-mail would still show broken English and go something like this. Hi my name is Frank Douglas, I CEO of Solar Tech here in the United Kingdom I inquire about your solar panels we are in desperate need solar please please send me price by end of today.

This year the scams are even bolder, it starts with a phone call from a thick accent that you won’t be able to understand. In fact it is so fast and bad we just have to ask them to send us a request in e-mail. When the request comes through, it is also in very broken English but again appears to be coming from a legitimate person.

This week it came from what appeared to be project manger of a Minneapolis based solar company,

Hello Paul,

I called in few minutes back. I hardly hear you clearly Paul, iguess the network was bad because I'm at our project site. Here is a product that we are looking for. Grundfos 11 SQF-2 Submersible pump. Lorentz Submersible pump PS 1800 with controller. They will be used for irrigation in the farm in Grand junction, Colorado (CO) 81506.

Please note that we would appreciate a prompt response from you before the end of the day.

We hope that this can be the start of a long lasting business relationship.

Yours Sincerely

XXX XXXX

IGI INC

This is our response

They are in stock and ship out of Northern Indiana. We accept all credit

cards you can order directly online at http_________________________________.

Next e-mail

Good morning Paul.... Thanks for your email. We have tried to get the order done directly online through the link you sent. Each time we are about getting to the final stage of the order, we usually see "ENTER THE COUPON CODE" and we cannot see any coupon code to be typed in the coupon code box.

Our proposal is this:

you already know what we looking for (Grundfos - SQFlex DC Power

Submersible Well Pumps) Let the GPM be 11. can we place the order

here? if YES, we will have to hold brief meeting on the order and as

soon as the order is approved, we will send you the payment details.

Advice because we are ready to move forward.

Have a nice day.

Our response:

_________, I'm sorry but our Security and Fraud team has flagged your correspondence with us as not being from the company you are representing. With that we will not be able to make this sale to you.

If this is in error we are sorry, but we receive several scams per week following the same pattern as you are. If you are truly_______, which by the way does not sound like you on his VM either, then we will need more verification that you are with IGI Solar.

Here are the tip offs to prevent you from being scammed

  • Broken English, always followed with some type of urgent response required on the merchants part, either at the beginning or at the end.
  • The email addresses will have the company name in it, but they will not be from a company server, instead they will end in a G-mail or Yahoo account. They may even give the company web site which will probably list their name as they have assumed that identity.
  • They will ask for price and shipping even though they have seen the product online and know what it will cost.
  • They will attempt to lure you outside of your secure payment gateway to provide alternate payments. Don’t even do Pay Pal for more information Google Pay Pal scams.
  • In these recent calls the area code they claimed to be calling from was actually a N.J. based number.
  • When pressed with an exact shipping address or more information to verify they quickly break off communication as they know they have been found out.

How to protect your company

  • Stay within your secure payment gateway and don’t give in to them even if the sale sounds real and one that would really help in a sluggish sales week.
  • If you are not comfortable in making a sale don’t. Once they have the product(s) you’re left holding the bag with either a phony cashier check or a charge back.
  • Ask them for more information to verify they are from the company they represent.
  • Do your homework and call the company to talk to the person they claim to be, even if you don’t talk to that person directly, like in the case above we could tell just in the VM this was not the person we were talking to on the phone.
  • Do some homework more than just looking up the company online. Last year we Google the proposed ship to business address on satellite images and saw that it was actually a bar in England.

Oddly the potential recent scams we have encountered seem to center on a Minneapolis based company, although the calls are coming from New York or New Jersey. One of them may even have been a phony front company with a real looking web site. After we attempted to contact them to verify the company the listed e-mail we received bounce backs. No one would ever answer the phone either.

In talking to the receptionist of this latest company she did verify the name of the individual we supposedly was talking to, but when I dug a little bit deeper it appeared to be one of those rental office spaces with one receptionist covering many different businesses.

Online they appear to be a large company that one would think would not need this arrangement.

Please feel free to tag on any experiences you might have to help warn others, especially as the Holiday sales are approaching.

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